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European Equity Benchmarks Close Mixed; FTSE Moves Higher as CAC, DAX End Lower


Last updated: 01/13/2020 13:12:23

01:12 PM EST, 01/13/2020 (MT Newswires) -- The broad-based major European indices closed mixed in Monday trading as mining stocks lifted the FTSE higher, while automotive stocks burdened the DAX and CAC.

In economic news, the EU28 seasonally adjusted current account of the balance of payments recorded a surplus of EUR69.4 billion ($77.3 billion), or 1.7% of GDP in Q3, up from a surplus of EUR43.5 billion (1.1% of GDP) in Q2, and from a surplus of EUR42.0 billion (1.1% of GDP) in Q3 of 2018, according to estimates released by Eurostat, the statistical office of the European Union.

The EU28 recorded external current account surpluses with the USA (+EUR71.2 billion), Switzerland (+EUR13.4 billion), offshore financial centres (+EUR10.0 billion), Canada (+EUR10.4 billion), Hong Kong (+EUR6.9 billion), Brazil (+EUR6.8 billion) and Japan (+EUR1.3 billion). Deficits were registered with China (-EUR31.8 billion), Russia (-EUR2.7 billion) and India (-EUR1.6 billion).

In the UK, GDP grew by 0.1% in the three months to November, according to the Office for National Statistics (ONS)

"Overall, the economy grew slightly in the latest three months, with growth in construction pulled back by weakening services and another lacklustre performance from manufacturing," said Rob Kent-Smith, the ONS' head of GDP. "Long term, the economy continues to slow, with growth in the economy compared with the same time last year at its lowest since the spring of 2012."

Meanwhile, UK house prices increased at an annual rate of 2.3% during Q4 of 2019, according to the Halifax House Price Index. Moving up from a six-and-a-half-year low of 1.5% in Q3, the increase was the strongest recorded by the index since Q1 of 2019. Prices were also up 1.0% on a seasonally adjusted basis from the previous quarter, following an increase of 0.4% in Q3.

"In line with other economic indicators, the end of 2019 indicated the UK housing market enjoyed some positive momentum into the new year, but notable differences in regional performance persisted," said Paul Smith, economics director at IHS Markit said: "While there was evidence that the fog of uncertainty related to Brexit and the recent election has been lifted, helping to release some pent-up demand, prices remain under pressure in London and the south of England, in contrast to robust gains seen across Wales and the northern regions of the UK."

In Germany, the average index of selling prices in wholesale trade was 0.1% lower in 2019 than the average index of 2018, according to the Federal Statistical Office (Destatis). In December the selling prices in wholesale trade fell 1.3% compared with December 2018, and in November and October the annual rates of change had been -2.5% and -2.3%, respectively. From November 2019 to December 2019 the index remained unchanged.

And in Italy, estimates of retail trade continued to decrease in the month-on-month series, falling by 0.2% in value terms in November and dropping by 0.3% in volume terms, according to the Italian National Institute of Statistics (Istat). Istat said the underlying pattern in the retail sector shows a contraction in the three months to November, when both value and volume were down 0.1%.

Year-on-year both value and volume of retail trade grew for the sixth straight month in November, increasing by 0.9% and 0.7% respectively. Total sales of large scale distribution increased 3.3% from the same period a year earlier, while small scale distribution decreased 1.4%. And online sales continued to rise in the year-on-year series, rising 4.1% in November 2019.

In equities, mining companies helped buoy the FTSE in London as Evraz, Antofagasta, and Rio Tinto climbed 5.5%, 2.7%, and 1.5% respectively. Aerospace and defense firm BAE Systems was up 3.6%, while utilities company United Utilities, and water and waste management firm Severn Trent rose 2.5% and 2.4% respectively. Homebuilder Taylor Wimpey and electric services provider Centrica each closed 2.2% higher.

In Frankfurt, automotive stocks helped weigh down the DAX led by tire maker Continental, which fell 2.6%, followed by automakers BMW and Daimler, which dropped 1.3% and 1.1% respectively. Airline operator Lufthansa and Deutsche Bank lost 2% and 1.5% respectively, while health care company Fresenius and postal services provider Deutsche Post each closed 1% lower.

And in Paris, automakers Renault and Peugeot helped nudge the CAC into negative territory falling 2.8% and 0.9% respectively, while eye-wear company EssilorLuxottica, IT firm Atos, and facilities management services provider Sodexo were off 1.6%, 1.3%, and 0.9% respectively. Media company Vivendi and aerospace and defense firm Safran each closed 0.8% lower.

The FTSE gained 0.39%, the DAX lost 0.24%, and the CAC-40 edged 0.02% lower.

Price: 28.23, Change: -0.27, Percent Change: -0.96
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